All posts tagged Cash

Wednesday’s Powerball drawing could result in the third largest jackpot in U.S. history at $485 million. It is at times like these that many in the media engage in breathless speculation about what the lucky winner will do with their newfound wealth while curmudgeons in the financial sphere tsk-tsk about how silly some people are to waste their hard-earned money on participating in lotteries. Read More »

This particular group consists of five members: Apple, Microsoft, Google, Verizon Communications and Pfizer. In a new survey of 1,141 U.S. non-financial companies that it rates, Moody’s found this select club held $404 billion in cash at the end of 2013—fully 25% of the survey population’s $1.64 trillion pile. Read More »

U.S. nonfinancial companies has $1.8 trillion in cash on their books at the end of the second quarter, according to the Federal Reserve’s quarterly “flow of funds” report (now known formally as the “Financial Accounts of the United States”). But that figure includes a lot of assets that most people wouldn’t consider “cash” in their day-to-day lives, such as treasury securities, mutual fund shares and commercial paper. Use a narrower definition of cash –just checking-account deposits and literal currency — and companies had about $386 billion on hand, or a bit more than a fifth of their total liquid assets.

Until a few years ago, this was fairly unimportant distinction. For companies, “cash” was anything they could quickly convert into cash when needed. From the 1970s through the mid-2000s, the share of liquid assets held in literal cash fell as more financial options became available. In 1970, companies held about 60% of their liquid assets in cash. By 2007, the share had stabilized at around 10%. Read More »

Will investors rediscover the attractions of cash as interest-rate uncertainty roils every other market?

Ever since speculation started to swirl last month that the U.S. Federal Reserve would start to pare back its bond-buying program, markets have been jittery. That's not surprising. Central banks, led by the Fed, have been pumping up the prices of assets like equities that are seen as risky with quantitative-easing programs. Read More »